The Central Bank of Ghana (BoG) has expressed gratitude to the President of the Republic of Ghana – His Excellency Nana Addo Dankwa Akufo-Addo for the dignification during the National Honours and Awards 2023.

President Akufo-Addo during the ceremony applauded BoG for the distinguished roles it played during the fight to contain the Covid-19 Pandemic.

In light of this, BoG in a press release has appreciated the president’s immense effort for honouring the bank’s unconventional policy measures, which was borne out of the bank’s quest to support government’s programme, to preserve lives, and to ensure a stable and safe environment for economic growth during the Pandemic.

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However, the Bank of Ghana in its statement also responded to public discussions on its role in helping resolve the current economic crisis – which raised concerns about the bank’s understanding and workings of monetary policy doctrines.

“Since 2020, Central Banks all over the world have witnessed significant changes in the conduct of monetary policy due to the persistence of enormous shocks to the global economy. The spillover effects of these shocks were severe and costly, but have tendered to be grossly underestimated in the narrative of current economic developments in Ghana.

“Whilst it is the case that the key function of monetary policy is price stability and maintaining the value of money, periods of crisis management, such as the Covid-19 pandemic, had to come with dynamic and pragmatic policy response functions by central banks globally. In the face of the unprecedented pandemic shock, Central banks were placed at the forefront and acted in concert with fiscal authorities to take swift and forceful actions to preserve human lives.”
Bank of Ghana

According to BoG, in recognition of timely responses to the crisis, Central banks formed a critical line of defence, with critical policies to prevent market dysfunction and acted prudently in their capacity as lenders of last resort.

Not only did most central banks cut interest rates, BoG further disclosed that the banks also injected large amounts of liquidity to ensure financial stability amid an economic and health crisis.

“Different tools were deployed to achieve objectives during the crisis – short term instruments, lending to financial institutions, outright purchases of government bonds, as well as regulatory and supervisory actions on the financial institutions.”
Bank of Ghana

For Bank of Ghana, the lessons learnt from the Covid-19 policy responses provided the blueprint in 2022 second crisis – when the Government lost access to the capital market, and financing critical government spending became a challenge.

This second crisis, as stated by BoG, was again managed prudently with central bank support to prevent disorderly defaults in debt service payments and help government machinery from grinding to a halt.

BoG pointed out that the management of the second crisis was done alongside working with the International Monetary Fund to craft a programme to resolve the economic crisis that faced the country, adding that: “Under such circumstances, all Central Banks reprioritized their objectives for the ultimate good of society.”

“As a Central Bank, we have always acted in good faith to the benefit of Ghana, and we are confident that the economy will return to the path of stability and stronger growth sooner rather than later.”
Bank of Ghana

Bank Of Ghana’s Support For Government During Covid-19

In the Course of Covid-19 pandemic, the Central Bank of Ghana had to immediately trigger its emergency support clause under Section 30 of the Bank of Ghana Act, 2002, Act 612, as amended, by purchasing a GH¢10 billion covid-19 bond to support the government’s Covid-19 policy responses.

An image of Doctors attending to a patient during the period of Covid-19

The Bank also provided an amount of GH¢10 million to the National Covid-19 Fund as seed-money, which enabled the Fund meet some critical health and social needs of those impacted by the pandemic.

That notwithstanding, BoG in partnership with the private sector, provided GH¢10 million grant (in line with the Bank’s corporate social responsibility), to fast track the construction of the Infectious Disease Centre at the Ga East Government Hospital, which became the nerve centre for managing the Covid-19 pandemic.